On Tuesday, June 25, the Business Coalition for
Fair Competition (BCFC) will host a forum to measure the sources and impact of
unfair non-profit competition with private sector companies, especially small
business. This forum is
scheduled to take place from 10:00am to 2:00pm at The Inn at Fredericksburg
Square, 525 Caroline Street, Fredericksburg, Virginia.
The Small Business Administration's (SBA) Office of
Advocacy will participate in a listening capacity to hear from a wide range of
markets, professions and industries. The SBA is considering this issue as part
of a White House "Innovation Initiative," an effort focused on the
specific needs and concerns faced by companies and entrepreneurs.
Non-profit organizations are provided special tax
status under section 501(c) of the Internal Revenue Code. These groups are
required to pay an "unrelated business income tax" or UBIT on its
commercial or "non-exempt" activities. The Federal Government first
exempted charitable organizations from tax in 1913. In 1950, in response to
complaints about unfair competition, Congress changed the tax law by creating
the UBIT. Under UBIT, revenues from sources unrelated to the non- profit's
tax-exempt purpose are subject to taxation.
The forum will bring to light the many cases in which
the government is losing tax revenue from the lack of enforcement of UBIT
activities and those that result in economic disadvantage to for-profit
businesses through direct, unfair competition.
The most recent White House Conference on Small
Business, in 1995, made this a priority issue when its plank read,
"Congress should enact legislation that would prohibit government agencies
and tax exempt and anti-trust exempt organizations from engaging in commercial
activities in direct competition with small businesses."
For further information or to RSVP for the event,
please contact John "JB" Byrd,
BCFC Government Affairs Manager.
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